The ATS is the smallest Cadillac since a pair of ill-fated Caddy compacts, the Cimarron and Catera. This new baby Cadillac, however, has all the credentials to make it a competent competitor with the segment leaders.

The ATS is available with a choice of three engines. The base motor is a 2.5-litre four-cylinder producing 202 horsepower.

The optional engines are a 2.0L four with a twin-scroll turbocharger that kicks out 272 horses or a 3.6L V6 that generates 321 hp.

Each powertrain will appeal to a specific type of consumer. The base 2.5L, for example, will be more than adequate for buyers more interested in fuel economy and vehicle price than higher performance. That’s not to say this four-banger is a slouch – it is smooth and responsive on the highway, though it did get a bit noisy when the six-speed automatic drops down a gear or two for passing power.

The real sweetheart is the 2.0L Turbo. It’s quick to respond with generous torque, yet it cruises sedately on the interstate. Coupled to the six-speed automatic with magnesium paddle shifters, it’s a delight to drive. This engine’s true performance potential, however, surfaces when it was mated to a slick Tremec six-speed manual gearbox. (The manual box is only available with the 2.0 Turbo.)

The 3.6 V6 is the big boy on the engine chart, with 321 ponies and 275 lb-ft of torque. It’s mated to the six-speed automatic and has more than enough grunt to satisfy the needs of drivers seeking superior performance. It’s smooth, quiet and cruises effortlessly on the highway while delivering impressive acceleration when the go pedal is kicked.

The new ATS gives Cadillac a competitive product in all three segments of the luxury car class, joining the mid-size CTS and the new full-sized XTS. The ATS, however, is not a stripped-down CTS – its architecture is specifically designed for this car.

While Cadillac officials hedge on the question, you can bet there will be other models coming that are based on this same, lightweight platform, likely including a coupe and possibly a sportback wagon.